===
May 20, 2019
President Janet Napolitano
Dear President Napolitano,
We write with a concern from both the Council of UC Retiree Associations and the Council of UC Emeriti Associations, a concern you will have already received from others regarding deliberations on changes to Retiree Health Insurance Plans available to our members. Our Councils’ concern, shared by others, is the apparent very short timeline for consideration of the Medicare Advantage PPO RFPs as possible replacements for some of the current plans for supplements to Medicare.
We are very aware of the challenge to sustain high quality health insurance while curtailing costs, especially as these costs are likely to continue to increase. We know that these deliberations are occurring in the midst of the 2020 political turmoil that could lead to changes in Medicare, changes that themselves could influence the types of insurance plans that might become available.
We thus encourage you to allow both the new Advisory Committee as well as the Health Care Task Force to review these proposals without haste, even if that means delaying implementation until 2021. They need time to examine the proposals, not only for cost savings to the University but also for the human costs that might result from the switch, particularly limiting access to long time service providers and procedures commonly used by members of the current plans.
We appreciate your interest in hearing our voices and look forward to continuing to help you make the University of California the best possible place to work and from which to retire after a long career on our campuses.
Best wishes,
Caroline Kane, Chair
Council of UC Emeriti Associations
Marianne Schnaubelt, Chair
Council of UC Retiree Associations
===
Dear Caroline and Marianne,
The President received your email letter on May 20th regarding the Medicare Advantage PPO RFP and asked me to respond on her behalf.
We know how important good health benefits are to UC employees and retirees, so I first want to assure you that the process we are engaged in is aimed at maintaining quality benefits, while balancing affordability and cost.
We understand and appreciate your concern about the short timeline for consideration of the Medicare Advantage PPO RFP. Please note that the RFP remains in progress and no decisions have yet been made regarding RFP implementation. A vendor has not been selected and further analysis is still required regarding impact to retirees and how an implementation would intersect with existing plans.
For further information on the RFP, I am attaching a Frequently Asked Questions (FAQs) document that may address your members’ questions and concerns. Please feel free to share these FAQs more broadly with your members.
Currently, the Benefits Programs & Strategy team is working on completing a detailed financial analysis of the identified RFP options. The newly formed UC Employee Health Benefits Advisory Committee (“Committee”), which is comprised of retained Retiree Health Benefits Working Group members with additional stakeholder members, will have the opportunity to discuss the RFP options at meetings scheduled on June 12th and June 17th. We have asked the CUCRA and CUCEA representatives on the Committee to keep your constituents informed and to collect their feedback and comments.
We encourage your members to continue to share their views through their representative members on the Committee. They may also direct their input and comments to a new email account (hbac@ucop.edu). Messages to the email will be reviewed and shared with all Committee members. Correspondence to the President regarding the RFP will be channeled to this email address going forward.
Thank you again for taking time to express your concerns.
Sincerely,
Rachael Nava
Executive Vice President – Chief Operating Officer and Chief of Staff to the President
===
Here is an excerpt from the FAQ (frequently asked questions) list referred to above:
Medicare Advantage PPO RFP
Q: UC recently issued a Request for Proposal (RFP) regarding a Medicare Advantage Preferred Provider Organization (MA PPO) — why is UC exploring this kind of plan for retirees?
A: Health care costs continue to rise, and for retirees, costs are rising at a faster pace, putting financial strain on retirees and UC. Over the past three years, Systemwide HR has been monitoring the evolution of MA PPO plans and their use by other organizations, such as CALPERS. UC’s initial observations indicate that an MA PPO may be a solution to better manage costs for longer-term sustainability, while offering comparable, if not enhanced, benefits with the same provider networks as UC’s current plans. Accordingly, UC issued an RFP to explore more deeply whether or not an MA PPO might work for UC, and a working group was established to assess the RFP responses.
Q: Who has been involved in reviewing responses to this RFP?
A: Representatives from the Academic Senate and CUCRA/CUCEA are part of the RFP working group with the ESC, and have been participating in weekly meetings since February. Several members of that working group have also been folded into the Health Benefits Advisory Committee. The working group is scheduled to draft recommendations to the ESC, including comments and positions from all members of the RFP Committee, in June.
Q: Why is the MA PPO review moving more quickly than the overall Committee review?
A: While health care costs as a whole continue to rise and the number of retiree health benefit recipients is expected to rise in coming years, UC anticipates high single/low double digit increases to retiree health costs in 2020. Should an MA PPO be selected, it would go into effect for the 2020 plan year to address those higher costs.
Q: What would be the advantages of adopting an MA PPO option?
A: In addition to cost savings, an MA PPO covers all of the care covered by Medicare Parts A, B and D, allowing retirees to maintain comprehensive coverage. Other large pension systems have adopted an MA PPO plan into their retiree health program to control costs with minimal disruption to their retirees. Over the past few years, CalPERS and City & County of San Francisco identified a sizable savings opportunity and added the plan as a program offering for their retirees.
Q: How would I be affected by an MA PPO option?
A: See below for some of the common questions about MA PPOs. The RFP review workgroup is evaluating the overall value of this option to benefits recipients as a whole, as well as to their financial sustainability.
Medicare Advantage PPO
Q: Will I be able to continue to use my current providers under an MA PPO?
A: Yes; retirees are expected to be able to continue to use their current providers. While providers may always choose to change their participation in plans based on their own business needs, other employers who have switched to a Medicare Advantage PPO have not reported any problems with access to providers who participate in Medicare.
Q: Will I need to select a primary care physician (PCP) and will PCP referrals be needed to see specialists?
A: No; MA PPO plans do not require the selection of a PCP for specialist referrals.
Q: Are my benefits lower if I use an out-of-network provider?
A: No; unlike typical PPOs plans, the benefit levels will be the same whether you use in- or out-of-network providers.
Q: Will my prescription drugs still be available at the same price?
A: Our goal is to minimize disruption to patients and ensure access to current prescriptions. Any exceptions and strategies to address them would be clarified as the exact potential impacts are identified with a new plan.
Q: Will I be able to use my same pharmacy?
A: Yes, with very few exceptions. Our analysis shows that less than 0.5% of all patients used a pharmacy that would be out-of-network in the MA PPO plan.
[Note from yours truly: If you want to find the secret sauce where the supposed $40 million saving comes from, the next Q&A is the likely location.]
Q: Are similar services covered under MA PPO plans as traditional Medicare?
A: Yes, MA PPO plans are regulated by Medicare and required to cover the same services as traditional Medicare. One difference is that in traditional Medicare, the Medicare program makes decisions about whether a service is ‘medically necessary,’ which is not universally defined. Under an MA PPO plan, the insurer offering the plan makes those decisions. High-quality evidence does not currently exist concerning how, if at all, medical necessity decisions differ between traditional Medicare and MA PPOs. [Italics added by yours truly.] In both traditional Medicare and an MA PPO, patients have the right to appeal any decision that they believe is made in error.
Q: Will benefits beyond Medicare currently covered by my plan be covered under the MA PPO plan?
A: Yes, the intent is to cover benefits beyond Medicare similar to today.
===
And that's all we have from the Merry Mailman today. If he brings more, we'll be sure to let you know:
No comments:
Post a Comment